Investors Broadly Optimistic with Sector Rotation

Here is a daily recap of the S&P 500 broken down by sector followed by sector heat map as investors broadly optimistic with sector rotation. Stocks in heat map are based on the top 10 holdings of each sector ETF. Click on each picture to zoom in. Below is a summary of today’s action on Wall Street provided by CNBC:

Dow jumps 250 points to start week even as White House, Congress battle over coronavirus relief

Stocks traded higher on Monday after President Donald Trump signed several executive orders aimed at extending coronavirus relief. The Dow Jones Industrial Average rose 250 points, or 0.9%. The S&P 500 climbed 0.2% while the Nasdaq Composite dipped 0.3%. The S&P 500 was also within 1% of its all-time high.

The S&P 500 (SPY) rose +0.27% today. Sector advancers led decliners 6 to 5 as shown below in the sector graph. Gains ranged from +3.09% to less than 1%. Communication services (XLC), healthcare (XLV), real estate (XLRE), technology (XLK) and utilities (XLU) each suffered minor losses of less than 1%.

The Dow Jones index climbed +357 points (+1.30%) to close at 27,791. The Nasdaq declined -42 points (-0.39%) to settle at 10,968.

Investors Broadly Optimistic with Sector Rotation

Stocks finished mixed on Monday as investors took profits in technology and put money in energy and industrials, more cyclical sectors.

Monday’s session was the S&P 500′s seventh straight day of gains. The advance left the S&P 500 less than 1% away from a record high.

The Nasdaq Composite struggled, however, and dropped nearly 0.4% to 10,968.36 as traders trimmed positions in Big Tech stocks. Facebook and Netflix shares slid at least 2% each along while Microsoft lost 1.99%. Amazon dipped 0.6% and Alphabet fell 0.1%.

“This actually suggests investors are turning more sanguine on the broader macro landscape, encouraged by the solid CQ2 earnings season and the bullish July economic data last week,” said Adam Crisafulli of Vital Knowledge.

Trump’s Executive Orders

President Trump signed multiple executive orders over the weekend designed to help coronavirus aid.

Those orders continue the distribution of expanded unemployment benefits, defer student loan payments through 2020 and provide a payroll tax holiday. However, the unemployment benefit will be continued at a reduced rate of $400 per week. Originally, the benefit provided workers impacted by the pandemic with $600 per week.

On Monday, Treasury Secretary Steven Mnuchin told CNBC’s “Squawk on the Street” he is open to more stimulus talks, noting: “We’re prepared to put more money on the table.”

Key Takeaways…

Notable S&P 500 Movers…

Below I’ve highlighted some notable S&P 500 movers (both winners & losers).

Credit: Sector Graph provided by Sector SPDR app. Sector breakdown provided by Charles Schwab. Sector heat map provided by finviz. Information Credit: News Headlines and quotes were taken from CNBC in the writing of this post.

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8/10/20

S&P 500 Sector Graph

Investors Broadly Optimistic with Sector Rotation

S&P 500 (SPY)

Investors Broadly Optimistic with Sector Rotation

Communication Services (XLC)

Investors Broadly Optimistic with Sector Rotation

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Consumer Discretionary (XLY)

Investors Broadly Optimistic with Sector Rotation

Consumer Staples (XLP)

Investors Broadly Optimistic with Sector Rotation

Energy (XLE)

Investors Broadly Optimistic with Sector Rotation

Financials (XLF)

Investors Broadly Optimistic with Sector Rotation

Real Estate (XLRE)

Healthcare (XLV)

Industrials (XLI)

Materials (XLB)

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Technology (XLK)

Investors Broadly Optimistic with Sector Rotation

Utilities (XLU)

S&P 500 Sector Heat Map

 

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